Malacañang has ordered the abolition of the Northern Foods Corporation (NFC), a government-owned and -controlled corporation (GOCC) engaged in tomato paste processing.
This is provided under Memorandum Order 58 issued by Executive Secretary Salvador Medialdea on December 1.
MO 58 cited that the abolition of the NFC was recommended by the Governance Commission for GOCCs due to the following reasons:
- the functions or purposes for which the NFC was created are no longer consistent with the national development policy of the state;
- the NFC is not producing the desired outcomes and not cost efficient and does not generate the level of social, physical and economic returns vis-a-vis the resource inputs; and
- the NFC is engaged in activities best carried out by the private sector.
“Since its incorporation [in 1984], the NFC has been incurring annual net losses, except in the years 1989, 1995 and 2010,” the memorandum read.
As a result, the assets of the NFC shall be liquidated to settle the outstanding liabilities of the corporation, in accordance with relevant laws, rules and regulations.
In addition, MO 58 provides for the creation of a Technical Working Group (TWG) for the implementation of the President’s directive.
The TWG will be composed of representatives from the following agencies:
- GCG
- Department of Agriculture;
- Land Bank of the Philippines;
- Department of Budget and Management; and
- the Privatization and Management Office of the Department of Finance.
The TWG will settle the liabilities of the NFC, undertake steps necessary in the liquidation of its assets, and assist in the winding-up of its corporate affairs.
Likewise, the TWG will resolve issues on the transfer of equity investment in the NFC from the National Livelihood Development Corporation (NLDC) to the Land Bank of the Philippines in relation to Memorandum Order No. 85 issued in 2015.
The TWG is also authorized to grant separation pay to affected officials and personnel of the NFC with the following maximum rates:
- 1.00 multiplied by monthly basic salary multiplied by number of years of service for first 20 years of government service
- 1.25 multiplied by monthly basic salary multiplied by number of years of service for those who served for 20 to 30 years and
- 1.50 multiplied by monthly basic salary multiplied by number of years of service for those who served for over 30 years.
“The separation pay authorized herein shall be charged against the available corporate funds of the NFC, and such other funding sources that the Department of Budget and Management may identify, subject to existing budgeting, accounting and auditing laws, rules and regulations,” the memorandum said. — VBL, GMA News
Palace abolishes Northern Foods Corporation
Source: News Panda Philippines
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